For those interested in buying or selling a home, you are likely interested in hearing about how the housing market will veer in the coming year. Although there is no way to tell exactly what will happen, the experts are forecasting several different real estate trends that will affect both sellers and buyers.
Housing Inventories Will Rise, But Not Too Much
This 2023, we have seen that there are very few houses on the market, in comparison to past years. For there to be an increase in the housing market this year, there would need to be more homes built or more current homeowners who list their houses for sale. According to Lawrence Yun, the chief economist working for the National Association of Realtors, it is not unlikely that there will be more new builds, and it is also not unlikely that homeowners will sell at higher rates this year. Housing inventories, then, might be higher in 2024.
Housing Prices Will Slightly Increase
How much will houses cost in 2024? This question is the one burning in the minds of all prospective homebuyers. If you’re purchasing a home, you want to secure your new home at an affordable price, and considering the fact that the median home cost in September 2023 was $394,300, this was not the case in 2023. Again, Yun believes that there will be an increase in home prices in 2024. He would not be surprised if they increase by up to three or four percent.
Real Estate Markets Will Grow in the Coming Year
With prices likely rising in the real estate industry next year, it is not unsurprising to hear that the markets are growing. While during other fiscal years, the real estate market has experienced fast “rebounds,” in 2024, we should expect slow and steady growth. Depending on how much real estate costs in your locality will dictate how much the markets grow in your area. The housing market will look slightly different depending on where you are located in the country.
Demand for Homes Will Stay High
There are many reasons why there will remain a high demand for the housing market in 2024. For one, as the years go on, there are more people living in the United States. With this increase in population comes a need for more people to purchase homes. In addition, because interest rates are relatively low, many people have access to homeownership.
Homeownership, in many senses, is a bit more accessible to more people with there being lower rates. Finally, there are many people moving into populated areas, and oftentimes, there are rental shortages. This, in turn, makes people more inclined to purchase a home.
Mortgages Will Be Around 6%
For homebuyers, it’s crucial to get a reasonable mortgage rate. But even more than just this, mortgage rates are important to the housing market because they help current homeowners determine whether or not they’re going to sell their homes.
Currently, many homeowners are skeptical as to if they should sell their homes because of high mortgage rates. In 2023, mortgage rates increased to averaging around 7%, and in 2024, mortgage rates will be just as high. We are expecting to see mortgages average in the middle-to-upper 6% range. This reflects a little dip, but nothing too significant.
Southern Homes Will Increase in Price
If you intend to stay in the New Jersey or Pennsylvania area, this trend won’t affect you as much. But if you’re looking to move south, know that the price of Southern homes is expected to rise more than homes in other localities this year. Therefore, it might be beneficial for those who live in Southern regions to sell their house in 2024, because there will be a spike in property values in places such as North Carolina and Tennessee.
Homes on the Market Will Be More Environmentally Friendly
As more people become interested in sustainability, we should expect to see more homes on the market that are environmentally friendly. These changes will come in many ways, as contractors are finding unique ways to create sustainable housing. However, oftentimes, with these changes come increases in price. So, although many homes will be more environmentally conscious, these homes will likely be more expensive, too.
We Will Remain in a Seller’s Market
If you’re unfamiliar with the difference between a buyer’s market and a seller’s market, the distinction is simple. In a seller’s market, the seller usually benefits more from the sold home. Meanwhile, in a buyer’s market, the seller usually takes a hit from selling their home.
We are expecting to see a slight increase in home inventories. However, this increase will not be enough to bring us out of a seller’s market in 2024. Because many people want homes, and there aren’t enough homes to go around in many senses, home prices are relatively high, and some sellers are surely reaping rewards from selling their homes. Just as this year was a seller’s market, it is not too risky to predict that next year will also be one.
Weidel Real Estate Can Help You Navigate the Housing Market
There are many things to expect in the coming year when it comes to the housing market. The cost of homes will steadily increase, mortgages will hover around 6%, houses will still be in high demand, and inventories will increase—but only a little bit. Of course, these are only a few of the things we should expect for 2024.